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Brazil’s Dangerous Climate Spiral

Drought is pushing the Latin giant toward more coal, and that means more carbon emissions.

View of cracked earth in an area that used to be underwater in the Jaguari dam, in Vargem, 100km from Sao Paulo. during a drought affecting Sao Paulo state, on August 19, 2014. The Jaguari dam is part of the Sao Paulo's Cantareira system of dams, which supplies 45% of the metropolitan region of Sao Paulo --20 million people-- and is now at historic low.

SAO PAULO—A massive drought that has left Latin America’s largest city on the brink of running dry. A long-awaited rainy season is yet to arrive, and key water reservoirs have shrunk to less than 5 percent of their storage capacity. Officials are warning that this city of 11 million could run out of water within weeks.

Rain has been scarce, with totals as much as 16 inches below normal in the Sao Paulo area. Coupled with high temperatures, that means that many of Brazil’s southern states are seeing water shortages, and there’s growing concern about the impact on city dwellers and farmers alike. Even though government officials haven’t admitted to any rationing, city residents talk about their taps going dry, and public fountains were spotted without water.

But the drought has carried a nasty side effect: The lack of water has weakened output from the nation’s robust network of hydropower dams, leaving many states switching back to coal and gas for their power and boosting Brazil’s carbon emissions.

And that accelerates an already-nasty cycle: Increased greenhouse-gas emissions also increase the threat of climate change, which scientists say can further fuel the kind of extreme weather that’s already crippling Brazil.

At the best of times, Brazil’s robust hydropower industry makes it among the world’s leaders in renewable energy. The country produces more than 400 billion kilowatt hours from hydropower a year, according to the U.S. Energy Information Agency, and more potential is in the pipeline. Dozens more dams are planned in the Amazon region despite concerns of the impact of construction on the land and people, notably the controversial 14,000-megawatt Belo Monte project on the Xingu River that’s under construction.

“Historically, there’s a combination of abundant water resources across the country and the fact that a very strong industry was created by building all of these dams,” said Roberto Smeraldi, founder of the environmental group Amigos da Terra - Brazilian Amazonia. “And so the government still gives priority to hydropower for electricity generation, even when you have gone beyond the low-hanging fruits and there are less-attractive types of investments.”

That’s of little use when those bountiful rivers aren’t flowing. And Brazil has been gripped by a massive drought since 2011, the region’s worst in eight decades. NASA images show the Jaguari Reservoir, one of five in the system that covers half of Sao Paulo, sapped to less than 5 percent of its capacity. With the drought stretching to rural and urban states alike, including the population centers of Minas Gerais and Rio de Janeiro, National Water Agency President Vicente Andreu warned lawmakers this month that unless more rain comes, the “region will have a collapse like we’ve never seen before.”

The browning of Brazil’s energy mix is already well underway.

According to a report from PricewaterhouseCoopers, Brazil’s carbon intensity rose by 5.5 percent from 2012 to 2013, the single largest rise among the world’s major economies (the U.S. was up 0.6 percent in that time). That’s due in part to a rise in deforestation after years of decline (the Amazon rain forest accounts for a bulk of Brazil’s emissions figures), but also reflects what the firm called a “temporary” problem from the loss of hydropower.

An analysis from Brazil’s National Association of Public Transport laid it out more clearly. In the first half of 2012, hydropower accounted for 89 percent of the country’s electricity production, compared with 74.6 percent in 2014. During that same period, the share of thermal power—which includes coal, gas, and biomass—tripled to 21.7 percent.

It’s similar to the problem plaguing California, where a drought that has stretched since 2011 has roughly halved that state’s hydropower production. According to the U.S. Energy Information Administration, monthly hydropower production was at 10-year lows for every month in the first half of this year in California while, to fill in the gap, natural-gas power was up 3 percent in that period compared with 2013.

In Brazil, natural conditions caused the problem, but mismanagement of already-thin water resources didn’t help. Governors were reticent to restrict water use, especially ahead of the elections earlier this month, and, instead, most officials publicly banked on the rainy season coming to ease the pain. The typical rains that start in late September and October, however, haven’t come.

The arid conditions aren’t just plaguing the large southern cities, but are also being mirrored in the Amazon rain forest. A 2005 “mega-drought” saw a swaths of forest twice the size of California go dry, reversing the Amazon’s traditional role as a carbon sink (instead of absorbing carbon dioxide, rotting trees emitted it). NASA researchers say the effects of that drought are still being felt and persisted until the start of the most recent drought in 2010.

And with deforestation rising again last year—up 29 percent in 2013 after years of declines—the lack of rain is likely to continue. The rain forest effectively acts as a pump for the country, absorbing moisture and releasing it through humid air that generates rain.

“It’s a simply hydrological equation,” said Michael Coe, director of the Amazon Program at the Woods Hole Oceanographic Institution. “The less evaporation there is, the less water there is for rainfall. We estimate that anywhere from a third to half of the rain that falls is coming from this evaporation.”

Coe said it’s unclear how much deforestation was directly contributing to dryness in the southern states but said it “could not be ruled out.”

What is clear to the country’s environmentalists is that a historic reliance on hydropower over other alternative energy sources has left Brazil desperate at a time of need. Brazil held a wind-only energy auction in 2009 that contacted more than 1,800 megawatts of capacity, a bid to diversify. Brazil’s Energy Research Agency told Bloomberg last month that the country also planned to purchase 17 gigawatts of wind power over the next decade, while also boosting the meager solar power capacity.

Claudio Maretti, director of the World Wildlife Fund’s Living Amazon Initiative, said that diversification is long overdue, especially as new hydroelectric projects become more expensive and carry greater environmental impacts. Maretti said that it’s ironic in a country that offers so much choice for telecom companies that power remains so inflexible.

“Why can’t I, in my home, choose where to buy power even if I have to pay a higher price?,” said Maretti. “We need to be talking about how to improve our grid supply instead of discussing how to build one more dam or getting oil offshore.”

Carlos Klink, Brazil’s climate-change minister, said that the power emissions were unfortunate, but that the government was working to diversify. More than that, he said, it offers a learning experience on how to cope with the kind of extreme weather that is possible as the climate changes.

“This gives us a flavor of what might come,” Klink said in an interview. “We’re seeing that we have to do more adaptation for the regional and local level, and we’re asking everyone to get involved

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